Homeownership has always been a major part of the American dream, but the landscape has shifted significantly over the past few decades. While homeownership rates have almost always been high in the United States, it wasn’t until the mid-1900s that it became a truly widespread phenomenon.
Since then, the trends surrounding homeownership in America have ebbed and flowed, with significant dips and gains that impact millions of homeowners and renters alike. On a large scale, these trends give us an idea of the overall state of homeownership in America, from its current state to its future prospects.
Current State of Homeownership in America
Currently, homeownership in America is holding steady at around 65%. This number has remained relatively stable since the end of the Great Recession and represents a vast amount of Americans. Despite this, some experts suggest that this number may be poised to fall in the next few years.
One reason for this is that the housing market is in its tenth year of growth, and many experts believe that a correction is overdue. If the economy takes a downturn, foreclosure rates could rise and push more families out of their homes.
Another issue impacting homeownership is affordability. Over the past 20 years, real estate prices have risen significantly, outpacing inflation and wage growth. As a result, many potential homeowners may struggle to find homes that are both affordable and within their means.
Current Trends in Homeownership
In addition to overall homeownership rates, there are several key trends to watch when it comes to the state of homeownership in America. These trends can tell us a lot about who’s buying homes and what the future of homeownership may look like.
One ongoing trend is that millennials are delaying homeownership. While previous generations often purchased homes in their 20s or 30s, many millennials are choosing to wait until later in life to buy. This could be due to a variety of factors, including high levels of student debt, a preference for urban living, and cost-of-living challenges in some areas.
Another notable trend is the rise of single women as homebuyers. According to a recent survey by the National Association of Realtors, single women represented 18% of all homebuyers in 2018, up from just 15% 20 years prior. This trend is expected to continue in the future, as women continue to achieve higher levels of education and professional success.
Future of Homeownership in America
Predicting the future of homeownership can be a challenge, given the many factors at play. However, certain trends and potential events could have a significant impact on homeownership rates.
One potential factor is climate change. As natural disasters increase in frequency and severity, more homeowners may face the prospect of losing their homes to events like flooding, wildfires, and hurricanes. This could impact homeownership rates in affected areas, as well as raise insurance premiums and alter the real estate market.
Another possible factor is the continued rise of digital technology. As mobile and remote work become more popular, some professionals may opt to live in less expensive areas and commute less frequently. This could impact the demand for homes in urban areas and shift the real estate market towards more affordable suburban and rural areas.
Ultimately, the state of homeownership in America is shaped by several key factors, including affordability, interest rates, the economy, and demographic shifts. By keeping an eye on these trends, we can gain a better understanding of where the housing market is headed and what the future of homeownership may hold.